Access To Financing Agriculture: The Many Challenges For Nigerian Farmers

The access to finance and funding among farmers in Nigeria remains largely unmet despite government’s efforts of diversifying the country’s economy through its agricultural revolutional initiatives supported by the Central Bank of Nigeria, writes Ememeh Gabriel. The challenges are not only on the farmers themselves but also on financial institutions that can hardly identify genuine farmers from those that have been described overtime as political farmers. This, according to experts and farmers remains a bane to one of the major policies of the current administration towards moving the country away from a mono economy to multi-dimensional one.

President Muhammadu Buhari has continued to hint that the priority accorded agriculture in his administration remains primarily in a bid to achieve food self-sufficiency, economic revival and jobs’ creation. The President had also assured that his administration will continue to accord agriculture premium importance through programmes and initiatives that will motivate the citizens to produce enough food to feed the nation. This was one of his promises in his inaugural speech in May 2015. He had also in one occasion said, “We are hoping to motivate fellow Nigerians to work hard in this regard. We will continue to work closely with other countries to re-orient Nigerians towards their active involvement in the sector.
“We believe that the impressive agricultural developmental strides achieved by countries such as Vietnam, especially after the 1975 war, will be replicated here,’’ he said. To achieve this goal, the CBN in 2015 established the Anchor Borrowers’ Programme which sole objective was to create a linkage between anchor companies involved in processing and smallholders farmers of required key agricultural commodities. The programme was also meant to ensure the provision of farm inputs in kind and cash to farmers to boost the production of these commodities, stabilise inputs supply to agro processors and address the country’s negative balance of payments on food.

This was also targeted at addressing escalating rate of unemployment in the country and to encourage young farmers to invest their time in the agro sector of the economy. Two years after, the CBN Anchor Borrowers scheme has received wide commendation in some areas, particularly with regards to rice production across the country which has dropped the importation of the commodity by 88.4 per cent saving the country over $600m (N216bn). But experts and famers still believe more still needs to be done to sustain growth through the agricultural sector. The argument is that the government has failed to identify most prospective and genuine farmers making it difficult for these set of farmers to have access to fund and facilities already made available by the CBN through its several intervention initiatives. The situation has even forced some farmers with credibility to look the other way while accessing funds from the non-traditional financial institutions to fund their farming projects. ’’The government is making genuine effort base on its own level of understanding but I believe that they can improve significantly on their current effort by broadening their understanding and perspective about the agricultural landscape in Nigeria.

One of the things they need to seize is directing benefit subsidies and funding to political farmers’’, said Mr. Olajide Abiola, a data scientist with KiaKia Loans. Olajide who spoke with Leadership in an exclusive interview expressed displeasure over what he described as the inability of government to engage experts as consultants to help them identify and collate data of genuine farmers who will help facilitate the ongoing effort by the government on food security and economy diversification. He said despite the billions of naira made available by the CBN through its several intervention programmes, not more than twenty three per cent have been able to assess these funds putting pressure on private bodies like KiaKia Loans to meet the needs of these trustworthy farmers. ’’As at today, of the about 31 million verified units, less than seven or eight million of that have ever assess any form of credit or loan from the mainstream financial institution. ‘‘They (the government), he said, need to take a real sensor in understanding and identifying real farming groups like that of the Nigerian Farmers Group And Cooperative Society and provide costumers support in terms of financing, support, equipment, policies enactment with regards to produce from farms to better protect the interests of local farmers from importation’’.

The last time I recalled based on our understanding, there were about N220b made available with the CBN and the traditional institutions are finding it difficult to actually get these funds to the hands of farmers. What is difficult either in partnering with companies like KiaKia or engaging their service to help identify genuine farmers who need funding, and then we can securely provide this funding for them on specific terms, asked Mr Olajide who said the government might be progressing in error. ’’You can be making your best efforts based on ignorance, so government needs to cover a lot of knowledge gap especially in regard to their operation. I find it very disappointing that the largest maize farm in Nasarawa like the NFGCS has not been given attention by the government but we give them commendation with regards to some of their numerous efforts in rice farming through the Anchor Borrowers Programme. While there have been cries and complains from Prospective beneficiaries of the Central Bank of Nigeria ’ s ( CBN ) Rice Anchor Borrowers programme across the country, there are those who still call for the reboot of the scheme.

A couple of months back,  farmers in Benue State had accused the handlers of the Anchor Borrowers Programme of lack of transparency and deliberately frustrating their efforts to access loan, such that it has caused them meeting up with cultivating at the appropriate farming season. In Akwa Ibom same last year, farmers have called for the restructuring of the Anchor Borrowers initiative following the inability of the committee set up by the state governor, Senator Ben Ayade and headed by his Special Adviser on Revenue, Mr Godwin Akwaji to efficiently distribute the inputs to majority of the 5,746 farmers who are participating in the scheme. The farmers during an interaction with the Permanent Secretary, Ministry of Agriculture, Pastor Justin Ugbe, who went round the three senatorial zones of the state, weekend to meet with the participants on the scheme was told that the scheme did not meet the expected target on rice production and loan repayment because of glaring lapses. Mr David Esese, who spoke on behalf of the farmers had alleged that they visited the Bank of Agriculture at Obubra several times to get the financial component of the loan but were not given,  frustrating their efforts to cultivate the hectres of swamp already earmarked for their farms. This case is not different from the experience in Nassarawa where farmers believed to have own the largest maize farm in the state (NFGCS) continued to lament over government failure to provide the necessary intervention to encourage their efforts gear towards supporting the federal government’s efforts to diversify the economy for sustainable growth.

The National Coordinator of the Nigerians Farmers Group And Cooperating Society Mr. Retson Tedekhe, who spoke withLeadership recently said ’’this year alone, we are going to have not less than 3 thousand tons of maize coming out from the farm and when you look at all these indices, you can said yes we have added something to the society but what is the government doing to encourage us. We were asked to go to the farm by the government but it seemed we were almost left to our fate if not for non-traditional lenders like KiaKia Loans who have facilitated most of our projects’’, lamented Mr. Tedekhe. ’’We had the hope that the government through it Anchor Borrowers initiative will come in on time to assist us because of what we had on ground. Imagine starting with over a thousand hectares. It is massive for any starter. ’’ Funding is a major issue with regard to the Nigerian farmer today. But there are opportunities and project where companies and individuals who believe in the same course are willing to support the process. ’’The CBN is creating massive intervention funds for farmers the biggest challenge is that farmers are not able to assess this facilities. For us, we have had two major sources of funding; membership subscriptions and loans and supports from organization like KiaKia who are able to package short term funds with reasonable rate that farmers can run to and assess and pay back as at when due. ’’It has been a battle to raise fund and let me tell you the truth that Nigerians are willing to go to the farm.

Farming is a very lucrative business if the government is willing to make it attractive but access to funding, resources and subsidies have become a major issue and that really need to be worked out. What is wrong with the government with looking at what is working and make it look better?, asked Mr Tedekhe who quipped that why should the Nigerian farmer provides everything that he needs, adding that government hold farmers the responsibility to provide assistant in the area of employment like they are doing with the N-Power Programme. He said they can also provide support in the areas of machinery just like it is practise in other parts of the world. ’’A State in India alone has over four million tractors while here in Nigeria we have less than a hundred thousand tractors. How can over 180 million people struggle with just a hundred thousand tractors?  How can 180 million people struggle with fifty thousand bulldozers?  That is why I have always talked about the failure of our people. The point is this, if you want to grow, you can’t put the burden on private business men like KiaKia or Olajide who are supporting us with short terms loans today but to bring them on board as consultants to help make policies that will go a long way to help the economy grow, he concluded.
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